Only about 0.06 percent of federal employees are denied a step increase due to performance.

Based on data from the Office of Personnel Management, Federal Times found that only 737 out of more than 1.2 million General Schedule employees did not receive a regularly scheduled step increase and accompanying raise in 2009 because of poor performance.

“Most people I spoke to say it’s really a sign that the government performance accountability is not cutting it and needs to be improved,” said Steve Losey, senior writer at the Federal Times, in an interview with Federal News Radio’s Mike Causey.

The National Treasury Employees Union says the pay system does not need to be changed, but managers do need better training so they can do a better job of tracking performance and holding employees accountable.

“The General Schedule is a structured system. It has both merit and market-based components. Within-grade and career-ladder promotions are subject to merit standards. Non-performers can be denied merit pay increases,” the Federal Times quoted Colleen Kelley, NTEU president, who was speaking at a March 9 hearing on federal pay.

However, groups including the Cato Institute and the Partnership for Public Service say the problem lies in federal managers believing that withholding a step increase “is not worth it,” Losey said. Denying a pay raise could mean a manager spending months to fight appeals that could end up going to the Merit Systems Protection Board. It could also mean causing “strife in the workplace,” Losey added.